The Aussie dollar has plunged to a six-year low of 70 cents.
The devaluation has raised fears the dollar could dip even lower, despite being almost on par with the American dollar just 12 months ago.
AMP’s chief economist, Shane Oliver, told Fairfaxhe won’t be surprised if Australia’s currency continued to drop.
“It’s on its way to 60 US cents,” Oliver said.
“The Aussie is a volatile currency but the broader trend is downwards. We’ve got to 70 US cents earlier than we thought, and it’s got a lot further to go.”
International tourists are spending big in Australia, according to research released today by Tourism Research Australia.
Spending was up 10% to a record $33.4 billion last financial year, the strongest jump in spending since the 2001 Sydney Olympics.
The number of international visitors to Australia increased by 7% to 6.6 million people in the past 12 months, with the majority of tourists coming from China, the UK and the US.
Tourism Research Australia’s assistant general manager, Spiro Kavadias, said the results highlight the opportunities available to businesses in the tourism industry.
“With these positive results and a growing domestic market, the Australian tourism industry is well positioned for growth and to continue making a significant contribution to the Australian economy,” Kavadias said.
Aussie shares are trading slightly lower this morning, despite an initial gain of 1%.
Ric Spooner, chief market analyst for CMC Markets, said investors are largely hopeful about what the day will bring.
“Asia Pacific investors are anticipating relief today after overnight share bounces and gains for oil and industrial metals,” Spooner said.
“Safe haven assets such as gold and the euro are lower as funds move back into equity exposures. A major source of market disruption is sidelined as markets in China are now closed for the week, and short sellers could add to the positive momentum in a scramble for cover.”
The S&P/ASX200 benchmark was down 0.59%, falling 30.1 points to 5071.4 points at 11:49am AEST. On Wednesday, the Dow Jones closed up 1.82%, rising 293.03 points to 16,351.38 points.
Broede Carmody is a former senior SmartCompany reporter. Before this, he was a co-editor of RMIT University’s student magazine Catalyst.
